{"id":332290,"date":"2025-04-22T00:10:00","date_gmt":"2025-04-21T16:10:00","guid":{"rendered":"https:\/\/www.pinoyinvestor.com\/smartinvestor\/?p=332290"},"modified":"2025-04-21T23:53:21","modified_gmt":"2025-04-21T15:53:21","slug":"stock-in-focus-areit-inc-areit-22-april-2025-by-rcbc-securities","status":"publish","type":"post","link":"https:\/\/www.pinoyinvestor.com\/smartinvestor\/stock-in-focus-areit-inc-areit-22-april-2025-by-rcbc-securities\/","title":{"rendered":"Stock in Focus: AREIT Inc. (AREIT) – 22 April 2025 by RCBC Securities"},"content":{"rendered":"\n

Summary of Broker’s Recommendation<\/h2>\n\n\n\n
Stock Code<\/strong><\/td>AREIT<\/td><\/tr>
Company Name<\/strong><\/td>AREIT Inc.<\/td><\/tr>
Broker<\/strong><\/td>RCBC Securities<\/td><\/tr>
Opinion Issued on<\/strong><\/td>22 April 2025<\/td><\/tr>
Recommendation<\/strong><\/td>Buy<\/td><\/tr>
1-Year Target Price<\/strong><\/td>PHP 43.80<\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n
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A new wave of asset infusion, via a property-for-share swap with sponsor ALI and subsidiaries, valued at Php21 billion, is upcoming, and this will augment AREIT’s assets under management (AUM) further to Php138 billion upon completion. We have not factored this yet in our earnings estimates. Reiterate BUY.<\/p>\n\n\n\n

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Analysis and Opinion<\/h2>\n\n\n\n

Portfolio size soars<\/strong><\/p>\n\n\n\n

AREIT has consistently increased its building portfolio annually over the past four years from 152,756 sqm at its initial public offering (IPO) in August 2020 to 1.03 million sqm as of the end of 2024. Including the land acquired in 2021 and 2024 that covers 2.86mn sqm, its total portfolio surged to 3.89mn sqm. AUM (assets under management) has grown 4 times to Php117bn, while DPS (dividend per share) has doubled over the same period. Since the last acquisition deal was consummated only in 3Q24, the full-year impact is just about to be booked this year, leading us to forecast another 8% y\/y growth in DPS (equivalent to 6.4% yield). <\/p>\n\n\n\n

Potential total return is 21%<\/strong><\/p>\n\n\n\n

We retain our target price (TP) for AREIT at Php43.80 based on the Multistage Dividend Discount Model (DDM) valuation method. The potential share price upside is 14.4%, and including our forecast dividend yield of 6.4%, the prospective total shareholder return (TSR) is 21%. We assume steady occupancy and a marginal increase in rental rates, a dividend payout of 93%, a cost of equity of 7.7%, and a sustainable ROE of 9%.<\/p>\n\n\n\n

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Check how many brokers recommend this stock<\/h2>\n\n\n\n
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All Stock Rankings<\/a><\/blockquote>